What should taxpayer watchdogs do when asked to make questionable payments? Get a lawyer, state bill says

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Orange County Auditor-Controller Eric Woolery has spent two years petitioning county officials to give him his own lawyer. Failing that, he drafted state legislation, now backed by 45 of his counterparts up and down California, that would ensure every county auditor-controller can receive independent legal representation. (Photo by Jeff Gritchen, Orange County Register/SCNG)

The man who signs billions of dollars worth of checks for Orange County says he sometimes faces a dilemma: If he thinks county officials have asked him to make an improper – or perhaps even illegal – payment with taxpayer funds, what should he do?

As the county’s elected fiscal watchdog, he says he can refuse to issue the funds, exposing himself to potential felony charges under some interpretations of state law. Or he can issue the checks and possibly be held liable for not adequately safeguarding public monies.

That’s why Auditor-Controller Eric Woolery has spent two years petitioning county officials to give him his own lawyer. Failing that, he drafted state legislation, now backed by 45 of his counterparts up and down California, that would ensure every county auditor-controller can receive independent legal representation. The bill, introduced by state Sen. Pat Bates, R-Laguna Niguel, is one floor vote away from being approved and sent to Gov. Jerry Brown.

Woolery says the current setup in California’s counties discourages auditor-controllers from halting legally questionable payments because the fiscal watchdogs receive their legal advice from county lawyers who advise and are hired by the same county supervisors who often approved the payments in the first place.

“It’s obvious that there is abuse to intimidate my office from being the watchdogs that we try to be,” Woolery said. “I need an unbiased legal opinion.”

Several other auditor-controllers interviewed said they occasionally have felt coerced to make legally questionable payments or thought county supervisors had tried to neuter them of their watchdog responsibilities.

“I really believe that (county supervisors) don’t want to share power and give us the tools to do our jobs: it’s self-interest,” Riverside County Auditor-Controller Paul Angulo said. “The supervisors have the allegiance of (county) attorneys. So right now, our leverage is nothing more than shaming people – writing a report and going to the board. How is that authority?”

At least initially, Woolery’s crusade drew fire from some politicians and lobbyists representing California’s counties, who worried that giving auditor-controllers their own lawyers could give them too much power to override decisions made by elected county supervisors. Orange County Supervisor Andrew Do has said in recent years that he doesn’t think department heads should have their own attorneys to dispute and contradict payments that the county’s lawyers already have said are legal.

But opposition to the bill largely dissolved after Bates amended it in April to require local superior court presiding judges to approve auditor-controllers’ requests for legal representation on a case-by-case basis – a process used by county sheriffs and assessors when they need independent attorneys. Orange County Supervisor Todd Spitzer said he supports Bates’ bill, SB 292. The other four supervisors, including Do, did not respond to requests for comment on the current version of the legislation. Orange County CEO Frank Kim and county counsel Leon Page declined comment.

Without independent attorneys, Woolery and other county auditor-controllers said they are legally vulnerable. They point to the cases of Robert Stark and Joe Harn.

Harn, the auditor-controller of El Dorado County, located east of Sacramento, paid $9,000 in out-of-pocket legal costs in recent years after the county’s board of supervisors voted to sue him for refusing to pay for a new fire engine. Harn said he concluded the county had broken the law by collecting special-district fees and the money earmarked for the fire engine needed to be returned to property owners.

“The board didn’t want to hear that they made a mistake, so county counsel tried to intimidate me,” Harn said. “But I had apprehensions because the auditor controller is personally liable if he makes an illegal payment.”

Robert Stark, the former auditor-controller of Sutter County, north of Sacramento, told senators during committee hearings on Bates’ bill that a lack of his own legal representation nearly destroyed him financially. He said he had to spend more than $300,000 of his own money defending himself against accusations he’d made illegal transfers of funds between county accounts. Stark was indicted in 2005, but after several appeals, the charges were dismissed by the district attorney eight years later.

In Orange County, Woolery hasn’t faced such direct legal jeopardy. But on at least two occasions, he has butted heads with county supervisors after questioning whether payments he was instructed to make were legal.

Do’s and Bartlett’s offices defended the mailers, which advertised public events the supervisors were hosting in their districts, saying county lawyers had pre-approved the fliers. Do also accused Woolery of overstepping his role by questioning county counsel’s opinion.

Bates’ bill unanimously passed in the Senate and every committee it has gone through. Even the Orange County Board of Supervisors hasn’t officially opposed the legislation.

Riverside County auditor-controller Angulo said he thinks SB 292 falls short of fully empowering auditor-controllers in their watchdog roles. “But it’s better than nothing,” he said.

But he argued seeking court approval is too laborious and auditor-controllers should have independent attorneys routinely available to advise them.

“We move a lot of money and we need some muscle.”

The state Assembly is expected to vote on SB 292 sometime after it reconvenes on Aug. 21.

Jordan Graham covers congressional politics and county government for the Orange County Register. He began his career reporting freelance civic and watchdog journalism in his hometown of Chicago before moving westward in 2013. He has previously covered Irvine, the San Fernando Valley and Costa Mesa for the Register. He is a graduate of University of Illinois and Northwestern University. Please email or call him with news tips.